O2 Home PhonePresentation to Affiliate Partners 24.05.2010

O2 Home Broadband – the story so farWe launched in late 2007 with Home Broadband packages that offered great quality at low prices…                 

19

9 10 11

4

117

0

10

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O2 Virgin BT SkyTalk Talk Tiscali Orange

Fans %

Strong underlying fandom and market-leading CSI

Awards, awards and more awards!

CSI: 79

Key differentiators from the competition

Free, UK-based Customer Services

No connection fees

Unlimited downloads

30 day Happiness Guarantee

…which have helped us grow from nowhere to a major share of the Net market in little over 2 years

Jan-0

8Ju

l-08

Jan-0

9Ju

l-09

Jan-1

0Ju

l-10

0k

200k

400k

600k

800k

1,000k

O2 Broadband Customer Growth

Sky BT O2

Virgin

Media

Talk T

alk

Orang

eOthe

r

(200)

(100)

0

100

200

300

400

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Share of Net connections - 2009

23% 8% 74% 4% -3% -16% 5%2009 base growth

O2/Be Cumulative Net Connections

Leading mobile company

Mobiles

Care about our customers

Today 2011 and beyond Leading connectivity

service brand

The connecting company

Love our customers

Turning customers into fans Twice as many fans asour nearest competitor

Where is O2 heading?

O2 Home Broadband was the first step on the journey towards becoming the leading connectivity service brand and winning more fans.

O2 Home Phone is the next.

Adding Home Phone more than doubles our addressable market…

274% increase

For 2010, customers in the market seeking a home phone and broadband bundle are estimated at over 1.1 million, compared

to only 403k seeking broadband only.

Total Market Gross Connections - 2010

…it’s what our existing customers and new prospects want…

• 67% of people prefer to bundle their home broadband with a home phone solution

• Bundles including home phone and broadband remain the most popular making up 75% of bundled sales

• The vast majority of leavers opt for a package with their new provider that includes landline

• 55% of leavers would have remained a customer if offered a package including landline

• 58% of customers polled on the o2.co.uk blog said that they would use O2 Home Phone

…so O2 Home Phone is here

Evening & Weekend - £9.50/month:• Line rental• Unlimited evening and weekend calls to UK landlines

starting with 01, 02, and 03

Anytime - £12.50/month:• Line rental• Unlimited anytime calls to UK landlines starting with 01,

02, and 03• 600 minutes of calls to 0845 and 0870 numbers• 600 minutes of calls to landlines in over 20 international

destinations• 25% discount on calls to mobiles from your landline

Key differentiators:

Value – the cheapest Evening and Weekend package of any major provider in the market at £9.50

Convenience – customers can now combine their O2 Home Broadband and Home Phone costs in one bill

Flexibility – a variety of key Bolt-Ons that can be added to your service if you choose, or left off if you want to keep your package cheap

Online bills only - no paper billing

Customers can keep their original home phone number

Award-winning, free, UK-based Customer Service

30 day Happiness Guarantee – customers can cancel their contract within the first 30 days with no extra cost

Customise the service to suit your needs

Bolt Ons Included PriceSingle Bolt Ons Hide My Number (141), Show My Number (1470), Last

Caller (1471), Last Number Delete (1475)Included

Single Bolt Ons Voicemail (1571) £1 per month

Single Bolt Ons Call Barring, Caller Display, Call Waiting £1.75 per month each

Single Bolt Ons Alarm Call, Ring Back, Three Way Calling, Speaking Clock

20p per use

For privacy (bundled pack)

Caller Display, Block Numbers £3.00 per month

For families (bundled pack)

Caller Display, Call Waiting, Call Barring £3.50 per month

For busy homes (bundled pack)

Caller Display, Call Waiting, Ring Back £3.50 per month

Bolt-Ons can be added either online or over the phone as and when they are needed

Competitor Comparison

8 Meg 20 Meg 2 Meg Best possible (up to 20 Meg) 24 Meg 10 Meg

Unlimited 10 Gb 2 Gb Unlimited 40 Gb Unlimited

12 month 12 month 12 month 18 month 18 month 12 month

None None £60 None £29.99 £35/£15

£7.50 £15.99Free (when taken with minimum TV package - £18)

£6.50 £6.99 £12.50

Standard Option 1 Base Home Max Essentials L

Max speed

Download limit

Contract Length

Connection Fee

Price

Line rental

Total Cost £17 £27.53 £29 (inc TV) £17 £18.48 £24.49

£9.50 £11.54 £11 £10.50 £11.49 £11.99

• O2 Home Broadband and Home Phone is the joint cheapest in market, with Orange

• O2 has the advantage of a 12 month contract on home phone and broadband, compared to 18 months with Orange

Key Facts

O2 Home Phone customers:… must have a working BT landline… don’t need to be an O2 customer to sign up … can order O2 Home Phone online or over the phone… will add Home Phone during set up of their O2 HomeBroadband… will have separate contracts for their HomeBroadband and Home Phone services, both lasting 12 months

…will be subject to a credit check when signing up to O2 Home Phone

For launch we can’t support…… new customers who don’t have a working BT landline … Cable customers… customers who only want to take Home Phone with O2 without Home Broadband

Q & A

Appendix - O2 Home Phone Call Charges

Included INTL landlines (Anytime package only, Fair Usage Policy applies) – Australia (incl Christmas and Cocos Islands), Austria, Belgium, Canada (includes calls to mobiles), Canary Islands, Cyprus, Czech Republic, Denmark, France, Germany, Greece, Hungary,

Republic of Ireland, Italy, Luxembourg, Netherlands, New Zealand, Poland, Spain, Sweden, The Vatican, USA (includes calls to mobiles)

Package Name Evening & Weekend Anytime

Package Price £9.50 £12.50

Line Rental Included Included

Calls types included (in bundle)

Unlimited calls to UK homes (starting with 01, 02, 03) on

evenings and weekends

Anytime calls to UK homes (01, 02, 03), 600 minutes per month of calls to 0845 / 0870 & landlines in over 20 International countries

(below)

Calls to UK homes (starting with 01, 02, 03)

Day – 4.5p per minute

Other times – Unlimited

Unlimited

Calls to 0845/0870 Day – 4p per minute

Other times - 1p per minute

Included

(Fair Usage Policy applies)

Calls to UK mobiles (O2, T-Mobile, Orange, Vodafone, Virgin, 3)

Day – 12p per minute

Other times – 7p per minute

Day – 9p per minute

Other times – 7p per minute

Contract term 12 months 12 months

Connection fee £0 £0

Services included Hide My Number (141), Last Caller (1471), Last Number Delete (1475), Show my Number (1470) Telephone Preference Service, online directory opt in, UK Customer Service